EPA proposes reduced Renewable Fuel Standard for 2014

Source: EPA, commodity groups | Nov 15, 2013

The EPA[3] has proposed levels of renewable fuels to be blended into gasoline and diesel as required by Congress under the Energy Independence and Security Act of 2007. Developed with input from the U.S. Department of Energy and U.S. Department of Agriculture, the proposal seeks public input on annual volume requirements for renewable fuels in all motor vehicle gasoline and diesel produced or imported by the United States in 2014. The proposal seeks to put the Renewable Fuel Standard (RFS) program on a steady path forward – ensuring the continued long-term growth of the renewable fuel industry – while seeking input on different approaches to address the “E10 blend wall.”

“Biofuels are a key part of the Obama Administration’s “all of the above” energy strategy, helping to reduce our dependence on foreign oil, cut carbon pollution and create jobs,” said EPA Administrator Gina McCarthy. “We have made great progress in recent years, and EPA continues to support the RFS goal of increasing biofuel production and use. We look forward to working with all stakeholders to develop a final rule that maintains the strength and promise of the RFS program.”

The proposal discusses a variety of approaches for setting the 2014 standards, and includes a number of production and consumption ranges for key categories of biofuel covered by the RFS program. The proposal seeks comment on a range of total renewable fuel volumes for 2014 and proposes a level within that range of 15.21 billion gallons. Specifically, EPA is seeking comment on the following proposed volumes:

Category

Proposed Volume a

Range

Cellulosic biofuel

17 mill gal

8-30 million gallons

Biomass-based diesel

1.28 bill gal

1.28 billion gallons

Advanced biofuel

2.20 bill gal

2.0-2.51 billion gallons

Renewable fuel

15.21 bill gal

15.00-15.52 billion gallons

aAll volumes are ethanol-equivalent, except for biomass-based diesel which is actual

Comments across the U.S. about the proposed RFS

The USDA, as well as national and state commodity organizations have released comments, and disappointment, about the proposed RFS.

"The Obama Administration remains committed to the production of clean, renewable energy from homegrown sources, and to the businesses that are hard at work to create the next generation of biofuels.

It's important to take a long-term approach to the RFS. Clearly, as Governor of Iowa and as U.S. Secretary of Agriculture, my support for the RFS has been steady and strong. But I also believe that improved distribution and increased consumer use of renewable fuels are critical to the future of this industry. We are proud of our record to support increased demand for renewable fuels. USDA has invested in the creation of advanced biorefineries across the nation; developed a unique partnership with the U.S. Navy and Department of Energy to create new biofuels for marine and aviation use; and boosted markets for nearly 3,000 U.S. companies that are creating biobased products from homegrown materials.

I am pleased that EPA is requesting comments on how we can help the biofuels industry expand the availability of high-ethanol blends, and I hope the industry uses the comment period to provide constructive suggestions. Together, we will be able to chart a path forward that maintains President Obama’s strong commitment to an “All of the Above” energy strategy for our nation.”

Tom Vilsack, Agriculture secretary, USDA

“The level set forth in the proposal is unnecessarily low and will stifle the growth and job creation potential demonstrated by the biodiesel industry over the past several years. Biodiesel, including biodiesel produced from soybean oil, is the most prevalent advanced biofuel currently produced in the United States. Biodiesel is the first and only EPA-designated Advanced Biofuel to reach 1 billion gallons of annual production. The industry has met or exceeded the RFS Biomass-based Diesel volume requirements each year they have been in place.”

Danny Murphy, president, ASA

“This recommendation is ill-advised and should be condemned by all consumers because it is damaging to our tenuous economy and short-sighted regarding the nation’s energy future,” said NCGA President Martin Barbre. “Agriculture has been a bright spot in a failing U.S. economy, but current corn prices are below the cost of production. EPA’s ruling would be devastating for family farmers and the entire rural economy.

“Ethanol and the RFS have been a great success story. Now, the EPA is sending a terrible message that we no longer have a long-term energy policy for biofuels, which was the original intent of this forward-thinking legislation. The Administration has clearly backed away from their commitment to renewable energy and this proposal blatantly contradicts the President’s Climate Action Plan,” Barbre said. “The goal of the RFS is to reduce our dependence on imported oil to make our country more energy independent and more secure. It has done that while also revitalizing rural America.”

Martin Barbre, president, NCGA

“The U.S. EPA’s decision to reduce the level of total renewable fuels for 2014 is both unwarranted and disappointing. Illinois Farm Bureau policy supports both the Renewable Fuel Standard (RFS) and higher blend levels of ethanol in our nation’s motor fuel supply to achieve reductions in greenhouse gas emissions and to push the United States farther down the path toward complete energy independence.

“EPA’s action is not about the inability of oil companies to blend anymore ethanol into unleaded gasoline. Instead, it appears to be a response to the industry’s well financed public relations and lobbying efforts and reflects the administration’s capitulation to the oil companies’ unwillingness to blend any more lower cost ethanol.

“In the coming weeks, Illinois Farm Bureau will submit comments and work with elected officials and other groups supportive of the RFS in the hopes of convincing EPA and the Administration to take a second look at a proposal that has the potential to drive up gasoline prices for consumers, increase greenhouse gas (GHG) emissions, and drop corn prices below the cost of production.”

Philip Nelson, president, Illinois Farm Bureau

Share your comments

EPA is also seeking comment on petitions for a waiver of the renewable fuel standards that would apply in 2014. EPA expects that a determination on the substance of the petitions will be issued at the same time that EPA issues a final rule establishing the 2014 RFS.

Once the proposal is published in the Federal Register, it will be open to a 60-day public comment period.

Once the comment period is open, public may send their comments via mail, fax or email, or they can add them online. Identify your comments with the Docket ID: EPA-HQ-OAR-2013-0747.